The Biden administration announced it has reached a $120 million deal with Polar Semiconductor under the CHIPS Act to help the company double its US production.

The US has been working to increase its domestic semiconductor production and reduce dependence on foreign foundries. The CHIPS Act has awarded billions to Intel and TSMC to assist the companies to build US-based foundries.

In the case of Polar, the Biden administration is going even further. In addition to providing funding that will help Polar expand its Bloomington, Minnesota facility and double expansion, the administration is arranging for private US capital that will shift the company from majority foreign-owned to majority US-owned.

“Thanks to President Biden’s leadership, with this announcement we are making taxpayer dollars go as far as possible to create jobs, secure our supply chains, and bolster manufacturing in Minnesota,” said U.S. Secretary of Commerce Gina Raimondo. “This proposed investment in Polar will crowd in private capital, which will help make Polar a U.S.-based, independent foundry. They will be able to expand their customer base and create a stable domestic supply of critical chips, made in America’s heartland.”

“We are very pleased to announce this historic investment in Minnesota semiconductor manufacturing. Our expanded manufacturing facility will allow us to increase capacity and branch into innovative technologies to serve new customers and markets,” said Surya Iyer, President and Chief Operating Officer of Polar Semiconductor. “Polar and its employees are grateful to the U.S. Department of Commerce and the State of Minnesota for their commitment to the future of American semiconductor manufacturing and appreciate the strong collaboration with the CHIPS Program Office, Minnesota Department of Employment and Economic Development (“DEED”), and the City of Bloomington, Minnesota, throughout this process. Polar is also pleased to welcome a significant equity investment from Niobrara Capital and Prysm Capital, which will allow the Company to become U.S.-owned, and for the continued support of our long-term partners, Sanken Electric and Allegro MicroSystems.”